Lori and Steve's elderly
parents are still living. The couple anticipates
that they will need to provide care for their
parents at some future time when their parents
can no longer live independently. Currently,
they are considering having their parents
move in with them to reduce the cost of care.
While thinking of providing care for aging
parents is admirable, it may not be practical
for a couple when both have careers and neither
have the time nor the skills to provide all
the care that may be needed. A solution here
is warranted, since nursing home costs are
substantial and expected to grow going forward.
Steve builds product prototypes and tests them for the manufacturer before products go to market. His business has been very successful and has grown over the years. As a sole proprietor, Steve's other assets and Lori's, after they are married, may be subject to various liability claims from creditors and injured parties. We'll explain how Steve can limit his liability exposure and save substantially on taxes at the same time by incorporating his business.
Lori has been contributing to her 401(k) plan at work, and, has accumulated a sizable account. Most of her 401(k) is invested in her former employer's stock. She acknowledges that having so much invested in one company is not a good idea, but she simply has not made diversification a priority. She is vested in a pension from this company, making it even more important for her to diversify away from the company's stock in her 401(k).
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